On the home(buying) front: the commitment and numbers

May 30, 2017

We’re under contract!

We submitted what felt like our millionth (it wasn’t) offer. As usual, once that was in, I filed away all our emails on that address and moved on with life: checking any new MLS listings, checking our financials, taking the kids for a walk.

At 2 pm the next day, our realtor called. Our offer was accepted with no more than a minor change to the closing date! Holy crap.

I explored my feelings like I was checking for a hole in a tooth – is that regret? Panic? Buyer’s remorse? A little of everything? It’s still a bit unclear but it’s not excitement that’s for darn sure. That has a place later in the timeline when we actually get to move in but that’s months away. Many months. And many dollars.

We debated the new date – a change from Wednesday to Friday. Our agent doesn’t like closing on a Friday but it was also only a two day difference which would make a rent back a total pain in the pertuckus. I prefer fewer complications in an already thoroughly complex transaction, please. We agreed, and braced ourselves for the appraisal.

We’d taken the chance with the appraisal – we’d chosen not to take the contingency. No offers with any contingencies had even been considered even when our offer price was competitive. On this one, we accepted that if the property assessed at a lower value than our offer, we’d be both highly annoyed and have to pony up the extra cash because our lender would only cover 20% of the appraised value.

I did the calculations to confirm that we could bear that extra cost if we had to. It’s a good thing we did, too, because it did appraise lower than the sale price. Curses. It wasn’t by a heartbreaking amount, we had discussed the possibility and accepted it, and we had budgeted for it, but it still bothers me to think about it. You know what bothers me most? Having to input a lower value on the appraisal line than the total paid value when I adjust our monthly numbers! Nerd.

It’s not the house of our dreams

That doesn’t matter because that house doesn’t exist for anything less than $3M! Which means it might as well not exist at all. We have champagne tastes, sometimes.

We live in humdrum reality! What we get is a major fixer-upper that we can (hahaha …. have to) renovate to suit our needs, of modest size, in a quiet neighborhood. It’s near conveniences like groceries and banks, it’s a single story, with a smallish backyard where I can do some gardening and Seamus can do some serious sunbathing.

It also comes with fungal infestations, termites, appliances that haven’t worked since 1976, windows that haven’t opened since the Reagan administration, and bathtubs that have been leaking since Timberlake was a Mouseketeer. That’s just what we can see on visual inspection. I can’t wait to see what happens when we rip up carpets designed expressly for the psychedelic age.

What I’m getting at is that what we saved upfront on loan costs, we’re spending on repairs and then some. At least we’ll be living with things that we picked, but I could have lived with a strangers’ bad taste for a while to save money, y’know?

I’m already slowly losing my mind

Aside from the money part ….

Supplying 16 more rounds of paperwork to the lender, seriously, didn’t we already go through this at the beginning? Why are we going through all of the statements again?
Getting recommendations, vetting vendors, scheduling walk-throughs with the general contractor, with the architect, with the inspector, with the other contractor, taking time away from work but still getting all my work done on time.
Updating the Spreadsheet to End All Spreadsheets with our projected income, expenses, down payment, closing costs, estimated labor & materials costs;
Mapping out all expenditures against the calendar to see when we’ll run out of money, and set the upper limit for our remodeling budget!

PiC knows I want nothing to do with picking colors for tiles or handles for cabinets. I don’t care about appliance finishes so long as they work well, quietly, and don’t create extra work for me. He cares so he’s on that mission, as well as making all the phone calls because I hate talking to people during my workday.

I head up all the financials ferreting out every possible saving and promotion I can find for things we already have to do. There’s a new checking account bonus at Chase that we’ll snag, plus they’re running a promotion for $595 cash back if you set up automatic mortgage payments with them. I’ll have to keep the account open for 6 months, which is fine and worth the nearly $800 we’ll reap for going out of our way with a new account for half a year.

We discuss our decisions and process together, but mostly leave the other to their set of jobs. It’s a good sign that our partnership hasn’t frayed under the strain of another full time job demanding our attentions while still trying to do full justice to our day jobs and parenting.

Squirrel!

I keep getting distracted! I’m supposed to be answering emails from the lender, and leaving our money the hell alone until we close.

Our dividends portfolio needs beefing up so I hop into researching the stocks that I wanted. It doesn’t help that TradeKing has become part of Ally. Every time I go to stare obsessively at our savings, I stare at our portfolio. But no: none of that cash can buy stocks, it’s already earmarked for renovations.

Then that reminds me I researched a new real estate investment: Fundrise. This was a really interesting prospect and we should put … oh. STOP, I can’t invest in an eREIT right now, renovations!

I need to book cheap travel for important family and friend life events for the year so obviously that means I should maximize the travel booking rewards by grabbing a new credit card for … oh. No, I can’t open a new credit card right now, we haven’t closed yet.

It’s not that I don’t have plenty to do, it’s that having the clock ticking down til escrow makes me feel like I’m in limbo and I hate limbo. I need to be doing things.

Except right now, doing money things is exactly what I can’t do because it’ll disturb the Escrow Equilibrium. I hate being told I can’t do whatever I want with my money.

FOCUS!

45 days until I can Gollum all over our money again. FINE.

What I am allowed to do is earn money and watch over our budget really carefully. We’re making decisions on what renovations to hire out ($$$) and what we can DIY (not that much for health and sanity reasons).

We’ll need every extra penny in case renovations go long, go over budget, or we need to carry our current mortgage a little longer than projected. PiC has had a nice streak of cash earning from his Craigslist sales, and I keep tucking every little (and big) bit away. Reimbursements from the FSA account, sales, blog income, it’s all being stashed.

That’s plenty to do along with keeping the day job ticking along.

:: How do you occupy yourself when you’re not allowed to mess with your money?

34 Responses to “On the home(buying) front: the commitment and numbers”

Ahh, love the psychedelic carpets … lived in a few houses with those. And ancient stoves (here that’s the only appliance that comes with a house; whiteware – fridge, washing machine are up to you).

I’m a bit worried about our kitchen floor – originally thought we’d leave it but the nasty laminate has started to come up so we probably need to rip it up. 2 of the bedrooms have lovely hardwood floors so I was hoping we’d have hardwood under the kitchen laminate … but from a quick peek, doesn’t appear to be the case … so chuck some more $$$ at the kitchen reno budget…NZ Muse recently posted…Peer pressure: You’re never too old for FOMO!

I haven’t been able to mess with my money for more than a year. Mostly, I’m coping by telling myself that things will be more normal in 2018. (I’ve already mentally written off this year.)

It helps that I’m a buy-and-holder and don’t really look much for new investments. I feel badly about not doing my usual thing, but am firmly reminding myself that my goal was to have enough money for the times when I need it… and that this is one of those times.

Wow, very exciting, but I understand your frustration. We have some “extra” funds that I would love to throw at our debt right now, but it’s smarter to wait until maternity leave is over.

Is there anything you’re looking forward to with respect to renovations? It seems like you made the right choice with a fixer upper that you can customize to best suit your family. I always like to paint. We moved around a lot growing up, living in lots of rental places, so we were never able to paint. I usually have at least a few accent walls with a bold/bright color. Our living room has a wall that is a bright teal color that reminds me of our cruise to the Bahamas (back in our less-frugal days).

Congrats! Hopefully by the time you move in a lot of those frustrations will have disappeared. Try the view the renovations as an adventure! You are building your own castle! (This is also coming from someone who has never lived through a renovation, so…)

Wow! Congrats! I understand the anxiety around the appraisal. I was worried about my house not being appraised at the offer price, but that turned out to be baseless. (Mainly because there were so few comparables. I still worry that I over paid for it, but it’s too late now.)

Sounds like the close can’t come soon enough for you. Before you know it, you’ll be able to play with your (more limited) money again, so just be patient.Linda recently posted…The progress loop trends downward

Congrats! That part of the process will probably drive me crazy, too. I’ve started wondering if there is such a thing as a “good deal” in real estate because like you said, you either pay for it up front or later with renos. Sounds like such a good neighborhood, though and I’m sure the little ones will be thrilled to play in the backyard!Femme Frugality recently posted…Summer Reading #Giveaway Extravaganza

Congrats on your new home! Even if closing is a few months away and even if lots of renovations are required, soon enough you will have a new place that is all your own (well, yours and the bank’s). In the meantime, sometimes doing nothing is the hardest part, but I’m sure you’ll get through it!

Congrats! And good luck with the renovations. Yeah, I’m with you on the dream home. Let’s just make do with what we have. A dream home isn’t realistic anymore.
I assume we can drop by when we’re in the area. 🙂

I promise I have compassion for your limbo sanity challenge, but you put it all in such a funny way! I hope laughing was allowed. You know what you have to do. Hold steady until the time comes. It reminds me of planking – just breathe and hold a little longer… Mind over matter. You’ll do it! (And you said “the kids”. Did I miss something?)Fruclassity (Ruth) recently posted…Financial Snowballs – The More, The Better

On some level it must be a relief, though. Searching for a house is dreadful…at least, I can’t imagine it’s anyone’s favorite hobby. It’s exceeded in dreadfulness only by the closing process. Hope you can get most of the renovations done before you move in.

One (ahem) nice thing about renovating is that you end up KNOWING what’s behind the walls. And there’s also the fact that your appliances and countertops and rugs and all that are YOUR choice. Always good.

Would a home warranty help with the little surprises, like the water heater that (invariably) springs a lead four months after you move in and the garage door opener that doesn’t open anything? That might allow you to wangle a few upgrades at a reduced price.Funny about Money recently posted…The Algae Jamboree

Ahh, love the psychedelic carpets … lived in a few houses with those. And ancient stoves (here that’s the only appliance that comes with a house; whiteware – fridge, washing machine are up to you).

I’m a bit worried about our kitchen floor – originally thought we’d leave it but the nasty laminate has started to come up so we probably need to rip it up. 2 of the bedrooms have lovely hardwood floors so I was hoping we’d have hardwood under the kitchen laminate … but from a quick peek, doesn’t appear to be the case … so chuck some more $$$ at the kitchen reno budget…NZ Muse recently posted…Peer pressure: You’re never too old for FOMO!

I haven’t been able to mess with my money for more than a year. Mostly, I’m coping by telling myself that things will be more normal in 2018. (I’ve already mentally written off this year.)

It helps that I’m a buy-and-holder and don’t really look much for new investments. I feel badly about not doing my usual thing, but am firmly reminding myself that my goal was to have enough money for the times when I need it… and that this is one of those times.

Wow, very exciting, but I understand your frustration. We have some “extra” funds that I would love to throw at our debt right now, but it’s smarter to wait until maternity leave is over.

Is there anything you’re looking forward to with respect to renovations? It seems like you made the right choice with a fixer upper that you can customize to best suit your family. I always like to paint. We moved around a lot growing up, living in lots of rental places, so we were never able to paint. I usually have at least a few accent walls with a bold/bright color. Our living room has a wall that is a bright teal color that reminds me of our cruise to the Bahamas (back in our less-frugal days).

Congrats! Hopefully by the time you move in a lot of those frustrations will have disappeared. Try the view the renovations as an adventure! You are building your own castle! (This is also coming from someone who has never lived through a renovation, so…)

Wow! Congrats! I understand the anxiety around the appraisal. I was worried about my house not being appraised at the offer price, but that turned out to be baseless. (Mainly because there were so few comparables. I still worry that I over paid for it, but it’s too late now.)

Sounds like the close can’t come soon enough for you. Before you know it, you’ll be able to play with your (more limited) money again, so just be patient.Linda recently posted…The progress loop trends downward

Congrats! That part of the process will probably drive me crazy, too. I’ve started wondering if there is such a thing as a “good deal” in real estate because like you said, you either pay for it up front or later with renos. Sounds like such a good neighborhood, though and I’m sure the little ones will be thrilled to play in the backyard!Femme Frugality recently posted…Summer Reading #Giveaway Extravaganza

Congrats on your new home! Even if closing is a few months away and even if lots of renovations are required, soon enough you will have a new place that is all your own (well, yours and the bank’s). In the meantime, sometimes doing nothing is the hardest part, but I’m sure you’ll get through it!

Congrats! And good luck with the renovations. Yeah, I’m with you on the dream home. Let’s just make do with what we have. A dream home isn’t realistic anymore.
I assume we can drop by when we’re in the area. 🙂

I promise I have compassion for your limbo sanity challenge, but you put it all in such a funny way! I hope laughing was allowed. You know what you have to do. Hold steady until the time comes. It reminds me of planking – just breathe and hold a little longer… Mind over matter. You’ll do it! (And you said “the kids”. Did I miss something?)Fruclassity (Ruth) recently posted…Financial Snowballs – The More, The Better

On some level it must be a relief, though. Searching for a house is dreadful…at least, I can’t imagine it’s anyone’s favorite hobby. It’s exceeded in dreadfulness only by the closing process. Hope you can get most of the renovations done before you move in.

One (ahem) nice thing about renovating is that you end up KNOWING what’s behind the walls. And there’s also the fact that your appliances and countertops and rugs and all that are YOUR choice. Always good.

Would a home warranty help with the little surprises, like the water heater that (invariably) springs a lead four months after you move in and the garage door opener that doesn’t open anything? That might allow you to wangle a few upgrades at a reduced price.Funny about Money recently posted…The Algae Jamboree